“Making An American Nickel Costs More than to Nickel,” the United States Mint recently admitted. Although the phrase looks like a tongue twenty, what is happening is that manufacturing a five cents – known in English like Nickel – is already more expensive than its own nominal value. And yet the international price of metal has collapsed, According to Financial Times.
The nickel lives its most disconcerting moment. It is a key material to make batteries, stainless steel, turbines, missiles and satellites, so demand should have driven prices. However, the offer has expanded so fast that the quotes have sunk.
In a report for the Financial Times They have pointed out That the price in the London metal bag (LME) is around $ 15,000 a ton, less than a third of what was reached in 2022. At the same time, production in referent countries, such as Australia or New Caledonia, was strongly reduced. BHP, the Australian giant, announced that it is reviewing the sale of its nickel assets in Western Australia. Even Tsingshan, one of the largest Chinese operators, suspended stainless steel lines to adjust the offer.
A new emerging superpower. In this context, Indonesia emerges as a great winner. After prohibiting the export of mineral in 2020, he forced the installation of foundations and attracted billions of Chinese investment. Today controls about 60–65% of global production, According to Bloomberg.
In the same medium They have pointed out That the jump is so great that, for the first time in history, Nickel export revenues exceeded those of coal: 16.5 billion dollars compared to 14,400 million in the first semester of 2025.
The problems that lurk to the market. The Indonesian domain raises strategic vulnerability for the West, which considers the nickel a critical mineral. The Financial Times Talk about a “Nickel OPEC” Controlled by Yakarta and Beijing. At the same time, western mines become unfeasible: Australia and Nueva Caledonia already reduce operations and Anglo American seeks to sell assets in Brazil. The operation with MMG, backed by Chinese capital, is being investigated by the Brazilian competition authority after the Turkish Corex Holding complaint, How have they explained in another FT report.
The result is an unbalanced map: Indonesia and China concentrate low cost capacity, while in the West the large mining companies are replicated or directly leave the business.
There is an even greater cost. Indonesia’s competitive advantage rests on coal. Four large companies in the sector issued 15.3 million tons of greenhouse gases, and those emissions could double around 2028, according to IEEFA calculations and create collected by The Diplomat. This model collides with the arrival of regulations such as the EU carbon border adjustment mechanism, which will penalize materials with great carbon footprint.
To this is added social risk: A report cited by The Guardian alert that a large part of the farms of transition minerals overlap with indigenous territories or fragile ecosystems, with accusations of deforestation, labor abuses and conflicts with local communities.
And the technological risk is added. The rise of lithium-cherrophosphate (LFP) batteries, that do not require nickelcan cut the planned demand. Although they have less energy density, these batteries are cheaper and more sustainable, and are gaining space in electric vehicles.
West, between the sword and the wall. The great Western miners face a dilemma. On the one hand, high costs and social pressures: the Resolution Copper project in Arizona, promoted by Rio Tinto and BHP, It has been delayed by the opposition for years of the Apache tribe of San Carlos. On the other hand, the strategic need to reinforce local supply chains. Washington has described nickel as critical metal, but its reserves are limited.
Mining companies do not want to lose their best client: China. In 2024, 57% of Rio Tinto’s income came from sales to China, compared to only 16.7% in the United States, According to data cited in Xataka. The export controls of minerals imposed by Donald Trump’s government – and Beijing’s response with restrictions on Galio, Germanio, Scandio or Disposio – show how metal trade has become a geopolitical weapon.
China: The pan by the handle. If Indonesia puts resources, China puts money and knowledge. The clearest example is Gem, a Chinese producer of battery materials that in the first half of 2025 doubled its nickel production in Indonesia up to 43,977 tons, reaching a record benefit of almost 800 million yuan, According to Bloomberg. In addition, Gem signed a 1,420 million dollar agreement with the Indonesian Sovereign Danantara fund to build a battery grade nickel plant.
China also ensures its position outside Asia. In Africa, As we have explained in Xatakahas invested more than 10,000 million dollars in cobalt, copper and nickel mines, especially in the Democratic Republic of Congo and Zambia, and accompanies those investments with infrastructure, bilateral agreements and, even, the export of armament and private security to protect mining interests.
In macro terms, China is becoming what some call the first “electrostate“. As my partner Matías has pointed outunder the plan Made in China 2025 It has managed to integrate the entire clean technologies supply chain: solar panels, batteries and electric cars. The country already generates more than a quarter of its electricity with renewables and de facto controls the global prices of electrification technologies.
Forecasts: what comes on the horizon. Nickel’s future seems written at several speeds. Indonesia will continue to consolidate its role as an epicenter of the global offer. The prohibition of exporting mineral, added to the avalanche of Chinese capital, has turned the country into the great refining of the world and the Yakarta government wants to take another step: not to settle for producing nickel nicing or chemicals, but also becoming a manufacturer of batteries and electric vehicles, How Financial Times points out.
In parallel, the demand for stainless steel will continue to absorb most of the nickel, but the battery market is emerging as the great engine of change in this decade. The problem is that this forecast can be too optimistic: LFP chemistry, cheaper and nickel -free, advances fast, which could moderate the expected growth. Meanwhile, prices remain depressed. The excess capacity in Indonesia and the slowdown to global consumption maintain the price under pressure, and the Financial Times Does not anticipate a recovery Significant in the short term.
To all this is added a new risk factor: climate regulation and consumer demands. Europe will impose tariffs on carbon intensive materials through the CBAM, and companies such as Mercedes-Benz or Samsung already demand nickel with low emissions, As The Diplomat remembers. The paradox is evident: Indonesian advantage based on cheap coal energy can be transformed into its greatest weakness if it fails to “decarbonize” its industry.
The dilemma that remains. The cheap nickel of Indonesia allows global electrification to be more affordable. But that nickel is “stained” by coal and doubts about social sustainability. For the West, producing at home is too expensive, and buying Asia means accepting dependence and carbon footprint.
The Guardian alert thatwithout deep reforms, international financing will continue to reward projects that destroy ecosystems and communities in the name of the green transition. The Diplomat Go further and denounce The irony of selling as a green mineral what is produced with coal.
The dilemma is summarized in a phrase: the nickel costs cheap in the bag, but is expensive in geopolitics, in emissions and human rights. The Electrification of the West goes to decide what price is willing to pay: to manufacture it at home at any cost, or to buy it where the coal sends?
Xataka | In the center of Africa a race for minerals that moves the world is fought. And China is winning it
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